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Story URL: http://services.silicon.com/offshoring/0,3800004877,39155956,00.htm

30,000 jobs lost to offshoring each year
But it creates jobs too...

By Sylvia Carr

Published: Thursday 26 January 2006

The offshoring trend has been in full swing this decade, with 30,000 jobs sent overseas every year since 2000.

The average number of jobs lost to offshoring by UK organisations is 180 while, at the same time, offshoring is credited with creating 58 jobs on average, according to a report from the Chartered Institute of Personnel and Development.

The research showed nearly a third of the 600 firms polled feel pressure to outsource a business activity but only a fifth said pressure to offshore has increased in the past two years, while three-quarters said it's stayed the same.

Despite recent reports that the Department for Work Pensions may offshore IT work, most public sector organisations - 94 per cent in this survey - don't think it's appropriate.

While manufacturing and production are the most likely tasks to be offshored, IT support and IT development came in second and third.

The number one reason to offshore by far was to reduce costs - it was cited by 86 per cent of respondents. This was followed by a skills shortage in the UK (27 per cent) and the desire to improve processes (21 per cent).

Disadvantages named by offshorers included negative impact on staff morale; increasing the difficulty of managerial control; and job losses in the UK.

In the end, however, two-thirds of respondents said they are satisfied with their offshoring experience, while only eight per cent are not very satisfied. However, more than 30 per cent of organisations which have offshored did not answer this survey question. And 15 per cent of organisations who've offshored have subsequently brought that activity back to the UK, according to the research.